Life assurer Prudential is planning to join the growing list of companies which have closed their generous final salary pension schemes to new employees.

The company is proposing to replace its final salary scheme with a "defined contribution" plan under which investment risk will be borne by workers.

Roger Lyons, the joint general secretary of the Amicus trade union, condemned the move, describing it as a "shameful act".

But Prudential said the new scheme - which includes generous sickness benefits, and allows for career breaks and part-time work - offered employees a better deal.

Stock market falllout

"We are introducing a high-quality defined contribution plan and we believe that it should become a benchmark against which other quality defined contribution schemes will be measured," the company said.

Final salary pension schemes, which pay workers a guaranteed proportion of their salary on retirement irrespective of stock market performance, are seen as the most generous form of pension provision available.

But the stock market slump, now in its third year, has made final salary schemes prohibitively expensive for many employers.

British companies to have restricted their final salary schemes in recent months include the banks Abbey National, HBOS, and HSBC, drugs giant AstraZeneca, and retailer Marks & Spencer.

Most have moved instead to alternative plans under which the employees' retirement income depends directly on stock market returns.

High Street giant Boots, meanwhile, has transferred its pension fund investments from shares into bonds.